Image projection systems may be used to enlarge a still or video image, or to enable the image to be viewed simultaneously by a large or small audience. Light pens have proven to be useful tools for use in presentations involving projected images, where they are typically utilized as nothing more than a pointer. Although light pens have been used as a substitute cursor, or mouse, such use typically has required the projected image to include pull down menus, ‘hot spots’, or other graphically defined regions, often detracting from the projected content, and effectively converting the projected image into a large computer screen. What is desired is a projection system which employs a light beam projector configured to interact with a projected image in a less intrusive manner that is also more flexible. More particularly it would be desirable to provide for data input and interaction utilizing the convenience of a handheld light beam projector which does not detract significantly from the projected image content.